SkyBus in dummy spit over $5 billion funding pledge

PRIVATE shuttle bus operator SkyBus has lashed out at the federal government’s promise to provide $5 billion for a Melbourne Airport rail link, demanding it “explain the business case”.

Just a day after Prime Minister Malcolm Turnbull made the funding pledge, the bus company has swung into lobby mode as it moves to protect its lucrative monopoly.

In a media release today, SkyBus said the government needed to justify the plan.

Co-chief executive Michael Sewards said Canberra was “committing $5 billion of taxpayers’ money for a gold-plated infrastructure without any business case”.

“Surely Victorians cannot be expected to support a service that is not backed up by a solid business case and sound economics,” he said.

Commuters queue for a SkyBus ticket at Melbourne Airport.Mr Sewards said SkyBus “welcomes any compelling mass transit rail option that can compete with our services”.

But he added that “surely there are important questions about at what cost the Victorian taxpayer will be asked to contribute (to) both the build of this and the ongoing operations, let alone the fare price a $10-15 billion investment requires for a return to its investors”.

SkyBus is a private company, owned by a consortium of investors including private equity house Catalyst Direct Capital Management and OPTrust Private Markets, part of Canadian pension fund OPTrust.

SkyBus has the rights to services between Southern Cross Station and Melbourne Airport.While other public transport and shuttle buses run to Melbourne Airport, SkyBus has the contract to run services from the city’s main public transport hub, Southern Cross Station, direct to the doors of the airport terminals.

It has a concession from Public Transport Victoria for those services.

The Herald Sun revealed yesterday that Canberra would provide $5 billion for the rail link project — which would also require an investment from the state government — with a view to work starting as soon as 2020 once a route was chosen.

The state government has vowed to work constructively with its federal counterpart on the plan.

Mark Knight’s perspective.SkyBus called on the government to “explain the business case”.

“With the cost of the project topping at least $10 billion before a route has been finalised ... there is a very real question about what the total cost might be, and whether fares will have to be subsidised by the public purse on an ongoing basis,” Mr Sewards said.

Mr Sewards vowed SkyBus would “continue to grow and expand our service” even if a rail link was built.

Sydney and Brisbane both have airport rail links, while a rail link from Perth Airport to that city’s CBD is being built.